No, it was initially intended to be used in a similar matter as the US dollar or British pound. It was divided into 100 sen and it was these which were used as equivalents to the penny. To send a letter in the 1930s would cost 2 sen, for example.
The yen continually lost value against the US dollar following its creation in 1871 (not necessarily a bad thing for an export-focused country like Japan), but not at an extreme level; the rate was still about 2 yen to the dollar before the beginning of the Second Sino-Japanese War in 1936.
Here's a chart showing the relative value of the yen against the US dollar over time. It's in Japanese but should still get across the idea that the yen's value changed drastically.
The loss of the war and destruction of Japanese industry and infrastructure led to hyperinflation an the collapse of the yen's value. Many countries would introduce a new currency at this point, but instead a new fixed rate of 360 yen to the dollar was introduced in 1949 as part of Joseph Dodge's plan for restoring the Japanese economy; use of the sen as legal currency was abolished in 1953.
Actually the proposed value of the Japanese yen when it was adopted in 1871 was the American dollar, full stop. They got on the gold standard as a matter of facilitating Western commerce with a specifically equivalent amount of gold to the lower yen pieces.
Now it’s difficult to tell how true this was in practice, especially since there were complications which arose very quickly. Japan had a lot of stipends to pay off, particularly with samurai, so they minted a lot of yen in the early years to repudiate that debt. (Jansen 2000, 373) However, the value maintained around two yen per dollar until around the Manchuria invasion. In December 1931 Japan abandoned the gold standard and quickly the value of the yen shot down. Within a year it had lost over half it’s value. (Gordon 2003, 192-193)
Now I couldn’t tell you whether this was a good thing or not since I have no economics background. I’m also unsure when yen stopped being minted in silver and gold, which obviously tanks it’s intrinsic value. After WwII it plummeted so hard that the US entered into and agreement to stabilize the currency at an exchange rate of 360 yen per dollar. From 1949 to 1971 it remained at a fixed rate until the undervaluization was realized and Nixon ended that. (Jansen 2000, 695; 732)
So despite the poor reputation of the yen in economic circles, it’s actually got a pretty high valuation in comparison to the last 60 years. Japan is still highly reliant on paper money (strange for how it’s gone so far on other technology) and I’m certainly interested to see how that alters the evaluation.
The Making of Modern Japan by Marcus B Jansen. 2000.
A Modern History of Japan: From Tokugawa Times to the Present by Andrew Gordon. 2003.
